When the talking heads spout about personal finance, they often portray Americans as the only ones that have problems with spending and debt. Make no mistake, everyone one is guilty to one degree or another of somethings makes financial decisions that may not be the smartest. But whether it’s problems we bring on ourselves, our problems outside of our control like a layoff, we’re not the only ones with debt issues right now.
The People’s Bank of China recently issued its second quarterly report on “payment system perspective.” (Here’s the link to it, but unless you can read Mandarin Chinese, it won’t be of any use to you- http://www.pbc.gov.cn/detail.asp?col=100&id=3347). And lo and behold, what does it tell us? That payments 6 months or more past due is up a staggering 131% from the same time last year!
How many credit cards are in China? There are over 163,000,000. The number of total cards in the country has been growing at astronomically high double digit rates, which we previously highlighted in post from March about China’s card usage.
So do we have some credit problems of our own? As Sarah Palin would say, “You betchya!” But, we shouldn’t beat ourselves up too hard, because we’re not the only ones in deep doo-doo. And while the Chinese are profiting left and right off of American consumers selling us [cough] crap [clears throat] I mean, consumer durables, we have quite a few inventions the good ol’ USA is using to profit off of their growth… two of them being the payment processing networks Visa and MasterCard! (And because they only process payments and don’t lend money, they’re not the ones taking the hit.)
Written Sept. 2009